US full-service investment bank Wedbush Securities has launched its execution solutions group (WESG) and ultra-low latency trading platform, powered by technology from high-speed trading technology provider Lime Brokerage, which the firm acquired in June last year.
The new platform uses the Lime Brokerage technology to give institutions access to the same micro-second trading system used by high-frequency traders. Wedbush has stated its intention is to help institutions discover superior liquidity by trading significantly faster and with greater scalability.
“Institutions have long wanted market access on par with the automated traders and we’ve fixed that problem by opening up our platform to both the buy-side and sell-side,” said Jeff Bell, COE of Lime Brokerage.
Lime algorithms will be available via WESG, including liquidity seeking and benchmarking algos such as VWAP, TWAP, percentage of value and implementation shortfall, as well as custom-made algos developed by the Lime Brokerage team together with clients.
WESG has also set out new cost-plus and fixed pricing models that it hopes will help institutional clients that are struggling with lower commission revenues and higher operating expenses. Users will be able to pay for research services directly through Wedbush Securities or via commission sharing agreements.
“Fixed pricing leverages the efficiencies in our technology, execution and clearing businesses,” said Kevin Beadles, head of execution solutions group for Wedbush Securities. “The transparency provided by our models allows clients to better manage their expenses and order routing decisions, which provides best execution while also potentially allowing them to realise significant cost savings.”
Founded in 2001, Lime Brokerage also provides the Citrius low-latency data distribution platform, as well as services for high-frequency options trading. In September 2010, Lime launched high-speed options execution capabilities, with "through-box" latency in the low double-digit microseconds (1/1,000,000th of a second). In May 2010, Lime also rolled out LimeInside, an exchange co-located sponsored access service for high-frequency traders. LimeInside lets high-frequency trading firms co-locate at major US trading venues without the potential for exceeding trading limits or violating other regulatory requirements imposed on the sponsoring broker.
Lime also provides equity options data for high-frequency options traders, offering non-members of the Chicago Board Options Exchange direct access to the exchange's data via its low-latency Citrius options data platform since August 2010.
The firm's strategy of deploying low-latency infrastructure beyond HFT firms has been part of Lime's game-plan since before Wedbush's involvement. In Q3 2010, then CEO Jeff Wecker said Lime was increasingly engaged in sales calls with traditional brokers that wanted to offer faster connectivity to their clients.
"Why does every broker-dealer have to invent its own high-speed, high-volume connectivity to the market?" Wecker said at the time.